The THC in the marijuana plant is medicinal and the fibers in hemp can be used in manufacturing. This has led to marijuana being legalized in some states in the US. This includes states like Colorado, Washington, Oregon and Alaska. It is expected that 16 more states will legalize the use of marijuana within the next 5 years. 14 of these states will legalize the use of recreational marijuana and 2 states will legalize medical marijuana. It is projected that by the end of 2019, legal marijuana will bring in a combined income of $ 19 billion in all the states that it has been legalized in.
Marijuana brings in a lot of cash though the banks are scared of serving marijuana business since Federal agencies might slap them with money laundering charges. Since the business has been shunned by banks, the marijuana business owners cannot use debit or credit cards and neither can they use their bank accounts.
Marijuana businesses have therefore been compelled to operate on a cash basis only, making it risky since their businesses are prone to violent crimes. Marijuana businesses therefore must take the necessary steps to ensure that they are safe and that they do not lose their money by taking the following steps:
- Investing in Technology such as CCTV cameras and putting up signage informing people of the same. Alarms should also be installed. This is in order to keep track of everyone that comes in and goes out of the business premises and every activity that is going on. The cameras should have a clear view of the point of sale, so that there is a clear view of who is coming towards the business. A safe should also be available to keep the money secure and should be locked at all times.
- Counterfeit money detectors and bill counters are also a good way to avoid being duped since most money counterfeiters pass off their fake cash in small amounts by giving them to marijuana sellers. Since the cash used is always in small amounts, most businesses never bother to look at the money keenly, which eventually results in big losses. Business owners should train their staff on how to inspect and identify fake money and also train them on what to do once they spot counterfeit money.
- Marijuana business owners should keep as little money as possible on site. Once the cash reaches a certain amount, the money should be moved out of the premises and taken elsewhere for storage. This includes banks or new companies that have been formed in a bid to solve the problem of having too much cash. These companies handle the money between the marijuana growers, sellers and their customers.
In the past banks and credit unions had been prohibited by Federal Law from taking any money from the marijuana business. In addition, banks were also worried about the reputation they will have once they took on customers who were in the marijuana business. They were afraid that they would be held responsible if something did not go right with the client. Anyone in the marijuana business faced problems when it came to keeping their money in the bank. This led marijuana businesses to start losing money due to the large amounts of cash they had and some people resorted to opening bank accounts in the name of other businesses, making it look more like money laundering. Recently, banks have been cleared to transact with marijuana businesses as long as the businesses are not distributing marijuana to children, taking it to states where marijuana is not legal or engaged in distribution by cartels.